Elder Law Issues

Too often we see one spouse of a client couple becoming incapacitated. Of course it's also one of the things we help plan for, but it still causes problems. Problems for the well spouse, naturally. But also problems for the couple's lawyers. It's not about us, but we do run into conflict problems when counseling half of a couple we have represented. The conflicts can be legal, practical -- and ethical. Today we talk about what that can sometimes mean.

The 2024 election is over. But 2025 was already going to be a confusing year for estate planning, and that promises to be even more true now. We talk about what might happen -- recognizing that it's all speculation at this point -- under a new administration and new Congress. Our prediction: we probably won't know what -- if anything -- needs to be done until well into next year. There is actually some certainty. Or at least confidence. For most people, there won't be any important change in their estate plan. That's because current estate tax limitations kick in at almost $14 million. That figure is unlikely to drop below about $7 million. So most of the uncertainty is for the quite wealthy. But the 2024 election will likely unsettle many of the expectations and plans for others, as well.

In this week's podcast, we give you a Corporate Transparency Act update. The CTA is still set to require nearly every LLC and small corporation, plus many other family business entities, to file identifying information before December 31 of this year. But a brand-new court case out of Texas may have changed the rules. Or not. We wrote about the CTA in our weekly newsletter a few months ago, and updated our coverage earlier this month. As we explained then, the Act requires anyone with more than a 25% interest in many kinds of entities to provide personal identifying information through a new government agency, the Financial Crimes Enforcement Network (or FinCEN). As we explain in this week's podcast, that structure was upended by a federal court holding that the FinCEN system for registration violates the U.S. Constitution. For the moment, the government is enjoined from requiring reports. But be careful about relying on that news. The federal government has appealed, there is a change in administrations coming, and the deadline (though suspended) still looms. What does that all mean? It means that our Corporate Transparency Act update boils down to: stay tuned.

Longtime Fleming & Curti, PLC, law clerk Jordan Young is a lawyer. For now, a young lawyer. She's been working with and for us for almost two years -- all through her last year of law school, studying for the bar and waiting for results. But now she's an honest-to-goodness lawyer. And we couldn't be happier or prouder. If you've been in our office in the past couple of years, you've likely met Jordan. She has been deeply involved in meeting clients, drafting documents and following up on details. Now she gets to do more -- practicing elder law with the rest of (Elizabth Friman, Amy Matheson and Robert Fleming).

Our clients often want to name multiple fiduciaries -- trustees, agents, personal representatives, etc. -- in their estate planning documents. We try to encourage them to just name one, or to name their children in sequence rather than making them co-fiduciaries. We are often unsuccessful. Clients might think they don't want to show favoritism. Or they are adamant that their children get along well. Or they want to compel them to work together. We will prepare our clients' documents with multiple fiduciaries if they really want. But our experience is that the arrangement is more likely to unsettle family dynamics and lead to conflict than to guarantee (or rely on) family harmony. And please don't ask us to require all of the fiduciaries to act together -- or even by a majority vote. That's a guarantee of slower and more expensive administration, and a strong contributor to family fights.

You might already know that paying for long-term care can be very expensive. That's true whether the care is in-home care or in a facility. And the costs associated with facilities vary widely (though all seem expensive). Just to set a benchmark for discussion, look at Genworth Financial's estimate of long-term care costs in different communities across the country. According to Genworth's figures, nursing home care in a semi-private room in Tucson is about $9,125 per month. Want a private room? Add a little more than $2,000 every month. Do you know how you will pay for long-term care for yourself, your spouse, your parent(s) or other family members? Most of us don't really have $10,000 per month in discretionary income. Thinking that you won't have to worry about paying for long-term care because you intend to stay at home? Think again. The costs of in-home care will probably be greater than nursing home care. Perhaps you've thought about securing long-term care insurance. In this week's podcast episode, we talk about insurance, public benefits and other ways you might be paying for long-term care costs in your family -- or for yourself. Join us for our discussion about the issues and options.

You may already know that the federal estate tax exemption for 2024 has been $13.61 million. We now have the tax exemption amounts for 2025. The federal estate tax exemption is the amount your estate must exceed before you will owe any estate tax. Some people have a smaller exemption amount than the published 2025 figure. They might have used up some of their exemption amount in 2024 or earlier years, for instance. But the general estate tax exemption amounts for 2025 will be $13.99 million for a single person, and twice that (or $27.93 million) for a married couple. The gift tax exemption amount is also scheduled to increase for 2025. The new number will be $19,000. That figure is per donor/per donee. In other words, you and your spouse can give a total to $38,000 to any number of individuals without owing any gift tax, having to file a gift tax return or in any way affecting your (or the recipient's) income taxes.

Nominating a guardian (in your will) for an Arizona family member can save legal fees, hassle and time. Maybe you have a minor child, or a child with a disability. For that matter, you might have an incapacitated spouse. You even might have a spouse at risk for becoming disabled. In all of those circumstances, your will nominating a guardian can smooth the process. That's true even for other family members (though not as effective), and it even works for a conservatorship of their estate. And it doesn't matter whether there is a guardianship (or conservatorship) already in place when you die.

Room and board agreements don't jump out as the most important item for your SSI-receiving child to consider if they live at home. But they can be important. Why? As we explain in this week's podcast episode, signing such an agreement with your son or daughter can maximize their Supplemental Security Income (SSI) benefit. That can mean (in 2025) an increase from $624/month to the full, maximum $967. How much do you have to charge in room and board agreements? At least $343 (in 2025). But maybe it will make more sense to charge $700-800. We discuss the options and how you can get maximum benefit from the room-and-board arrangement. And remember that every circumstance is unique. Just like you -- and your child.

If you have a child with a disability, you might be familiar with individually designed living arrangements (IDLAs). We often help clients create estate plans that make it easier for their child to benefit from an IDLA. Can individually designed living arrangements include your child staying in your home, where they grew up and feel comfortable? Yes, though the mechanics of those arrangements can make them challenging to implement. And the reality is that your family home might not really be ideal for an IDLA. But we can discuss the options and see what makes sense. Join us for a discussion of living arrangements as part of your estate planning for a child (or other family member) with a disability.

We often get calls from family members who are eager to start preparing for a death of a loved one. Perhaps mom has entered hospice. Maybe the hospital has indicated that it's soon time to remove life support for a sibling. Or dad is failing rapidly, and the family just wants to be prepared. What can we suggest when preparing for a death in the family? In a nutshell, our usual advice is: you don't want to spend your time with us. There's usually not that much that can be done to make things easier after a death. Most of the hard work of grieving, and the legal transitions, will have to wait until the actual event. Here's what we think does make sense in most cases: spend time with your loved one. Even if they don't seem to know you're present, you'll feel better later (and the rest of your family will, as well) if you are there as much as possible. But don't you need to move money from the trust into an easily accessible bank account? No. Can you make burial arrangements and pay for them? Sure -- but you don't need us for that process (and much of it really needs to wait until family begins to gather, anyway). Can you fill out the probate petition, or start the trust notifications? Not really. Or, more precisely, you could do those things, but you'll be redoing them later anyway, and it's probably not the best use of your time. Even immediately after the death of a loved one, we might not need to be the first stop. We'd like to see you (or whoever is going to administer the estate, or the trust) within a few days or a couple of weeks of the death, but there's no need to stop by our office on the way home from the funeral. And let everyone know that there won't be a check for them at the funeral itself. Plus we do have a checklist you might download and review. Then let's talk.

Clients often ask us to update their estate planning documents by preparing codicils or trust amendments. The idea of a codicil, particularly, is rooted in centuries of experience. If all you want to do is to make a minor change, wouldn't it be easier to sign a codicil than a whole new will? The same thinking can apply to a trust amendment. Wouldn't it be easier (and, probably, less expensive) to just prepare a 2-3 page document amending only the provisions that need to be updated? The truth is that few lawyers prepare codicils in the modern age. Why not? Because it's so easy to just sign a new will. And it's better for the client, too. Why? Because the client only has to keep track of one document, and can shred or destroy the old, superseded will. We're surprised how often our clients manage to separate their estate planning documents. Was there a trust amendment? Everyone seems to remember one, but it's not in the binder with the trust document itself. Where should we look for it? And what did it say? Our practice with regard to codicils and trust amendments? We haven't prepared a will codicil in decades. And we prefer to create a whole new trust rather than a second amendment. If the first amendment truly does just change one provision, and it looks like that's going to be the only amendment for a few years, we might agree to amend the trust. Once. One important principle: we usually prefer to "restate" the trust, rather than simply amend it (or, heaven forfend, create a whole new trust). Why? That allows the account title and real estate deed to stay the same. It's still the O'Brien Family Trust Dated March 17, 1997, even though it was restated in 2010 and again in 2023.

From time to time we relate stories about do-it-yourself estate planning gone awry. It's not that we get pleasure from explaining common mistakes. And we're not just trying to terrify people about self-help. We're trying to make it clear that the problems created by trying to save a couple dollars in legal fees so often end up costing far more than the legal advice would have cost. And the kinds of problems are hard to predict. Things that might seem reasonable to a non-lawyer can end up violating arcane -- or even well-known -- legal principles.

Trustee disclosure is required by Arizona law. But how much disclosure? Arizona's Trust Code sets some minimum requirements. The trustee of an irrevocable trust must let the "qualified" beneficiaries know that there is a trust, and how to reach the trustee. On request, the trustee must provide at least some financial information. But that's the minimum. In most (but not all) circumstances, we recommend that trustee disclosure include much more information. Bank and brokerage statements, time records and copies of trust documents themselves are all possible items of disclosure. Should they all be shared freely? As we discuss in this week's podcast episode, trustee disclosure is often a fraught topic. If the trustee is a family member, there will be family dynamics to consider. Failure to provide complete information might lead to suspicion and anxiety. Beneficiaries might be surprised to learn about past trustee decisions -- like when and how to sell assets, or billing for time and expenses, or division of personal effects. On the other hand, there may be good reasons for withholding full information. For one thing, the settlor of the trust might have explicitly requested limited disclosure. Or beneficiaries might be poorly served by having too much detail. And beneficiaries who receive a single (often small) dollar amount don't really need to get all the same disclosure that more substantial beneficiaries are entitled to receive. How much trustee disclosure is required? How much is advisable? As in so many legal arenas, the answer is a clear "it depends."

What are spendthrift trusts? It's pretty simple, really. A spendthrift trust has language directing the trustee not to honor attempts by the beneficiary's creditors to reach the trust assets. It also prohibits the beneficiary from encumbering the trust's assets on their own. More significant, though, is what benefits accrue as a result of the status of spendthrift trusts. The value of adding spendthrift language to a draft trust is to give the beneficiary at least some measure of creditor protection AND the donor some peace of mind. Join us as we talk about spendthrift trusts, what kinds of trusts qualify for the designation, and why you probably want any trust you create to include similar language. Also, we talk about why you can't just create a trust for yourself and give yourself spendthrift protection. At least not in Arizona.

Maybe you are involved in a trust administration proceeding. You might have created a revocable trust and wonder what you need to do to maintain it during your life. Perhaps you and your spouse created a trust, and you wonder what needs to be done now that your spouse has become incapacitated. Or maybe you are named as successor trustee and the original trustee has died. So do you need to hire an attorney in each of those situations? Or can you handle trust administration on your own? Our online mantra: we are Arizona attorneys and can't give you advice about your duties or abilities in other states. You should get local and particular advice about your situation and circumstances. But we can generalize about some of the issues -- and difficulties. First, some reassurance: you probably do not need any regular or active advice about administering the revocable trust you created. Of course you should check in with your attorney periodically to see what has changed. That can include changes in the law and (more often) changes in your circumstances. But what about administering a trust after the death of the settlor? That can be trickier. At least under Arizona law, there are a number of things that you are supposed to do when you take over. And there are more items to cover to satisfy federal tax authorities. Your duties as trustee are specific, sometimes technical and often non-intuitive. So you are probably well-advised to, well, seek advice. Trust administration is not especially easy, but a qualified attorney will probably provide more benefits than the (usually modest) cost.

SSI and SSD(I). It's so hard to keep them straight. Especially since SSDI is often referred to (including by us) as SSD. Supplemental Security Income (SSI) is a disability-based income program that requires recipients to meet financial eligibility tests. Social Security Disability Insurance (SSDI or SSD) is also a disability-based program but does not require that the recipient meet income or asset eligibility tests. The definition of "disability" for SSI and SSD is identical. But only the former program has a $2,000 cap on available resources. And if an SSD recipient has thousands of dollars of investment income every month, they can still qualify for benefits. That's not true for SSI. You can see why the programs are confusing, and why recipients have a hard time figuring out the eligibility rules. In this week's podcast episode, we try to uncomplicate the programs to help you understand them.

This week, a little inside baseball: we talk about Clio, our law office case management program. Fleming & Curti, PLC, had a decades-long relationship with Time Matters, starting with the DOS version in about 1992. It was once the leading case management program for law firms. We used it extensively, and in fact were recognized as national leaders in the use of the program. But it stopped adapting in the past decade or so, and it became obvious that it was time to move on. A relative newcomer in the legal technology world, Clio is cloud-based, creative and still developing new capabilities. So we made the switch four months ago. It has been invigorating, terrifying and awesome, all at the same time. Why do our clients (or you) care? Because of the expanded abilities the new software makes available. For instance, Clio offers: Client "portals." Want access to digital copies of your estate planning documents, or pleadings in your guardianship matter? We can set that up. Want to send us confidential documents but don't trust email? We can help with that, too. Billing. Our prior program also handled billing, but it was a clunky, unattractive arrangement. Clio lets us easily bill electronically, and gives clients a simple "click-to-pay" link that allows payment by credit card. That helps both of us -- clients and the firm -- immensely. Meetings. Yeah, any case management program is going to make it possible to schedule meetings. But Clio lets us set up Zoom meetings easily, and can update everyone with the link and reminders. And we can set reminders for in-office and telephone meetings, as well (though we're moving slowly, so we don't remind you of your dentist's office with flurries of reminders). Emails. Our old program allowed us to save emails to your file, and to share them with the whole office. But it was extremely hard to reply or forward when necessary. Now we can reply to an email even if it was sent to someone else -- and we can print out emails when necessary, too. Cloud availability. We will be able to look up documents, contact information and other data without having to go into the office. For a practice that includes a lot of fiduciary responsibility, that is huge. If a trust beneficiary or guardianship principal ends up in the hospital over the weekend, for example, we can respond faster without having to get to the computer system in the office. That's just a sampling. Clio is likely going to dramatically change our practice for the better. We just have to get through the transition phase.

When you establish a special needs trust pay particular attention to the most important part: choosing a trustee. The choice of trustee really determines how well the trust will work. There are several different types of special needs trust. Some are established by a parent or other person for the benefit of someone with a disability. Others are established by the individual themselves, or their guardian or a court. There are also pooled trusts. But they all share a common element: choosing the trustee controls how well the trust will satisfy the beneficiary's needs. Who makes a good trustee? As we discuss in this week's podcast episode, the perfect trustee knows law, accounting, public benefits, taxes, investing, social work and medicine. Oh, and they are immortal. Family members absolutely should be involved in care and expenditures for the beneficiary's benefit. But they don't always make the best trustees. Sometimes choosing a professional trustee is a better idea. Sometimes the value of a pooled trust can be the easy involvement of a professional group. Oh, and by the way: the same considerations apply to choosing a trustee for any trust. But they get heightened when the beneficiary has a disability and the public benefits system kicks in.

At Fleming & Curti, PLC, we often act as fiduciary. We might be a trustee, or a guardian or conservator, or an agent. In all of those roles, we try to make regular home visits. Why do we feel strongly about home visits? Because that's the best way to get to know our beneficiaries, principals and protected individuals. Regular visits are actually required in cases of guardianship, but we think the same idea applies to other fiduciary roles, as well. And we encourage other fiduciaries to adopt the same approach. Listen to our discussion about the concept, and (if you are a fiduciary, or will step into the role) please take inspiration from the concept. Want to dive a little more deeply into the need for visitation with a beneficiary/principal? This 2014 article from Estate Planning magazine, written by two special needs practitioners from New York, tell the story about how things can go wrong for a fiduciary.